Note: *Shazam first gained traction in UK, Spotify first gained traction in Sweden, Soundcloud first gained traction in Germany / UK / Sweden, Waze first achieved critical mass in Israel. All of these services have successfully expanded to other regions / countries, including USA.
Copyright 2011. All rights reserved.

0 Smartphone Users Mobile Phone Users
Source: Smartphone subscriber estimates per Morgan Stanley Research; Mobile phone subscribers per Informa (as of Q2:11). Note: While there are 936MM global 3G subscribers as of Q2:11, not all of them were smartphone users. One user may have multiple mobile subscriptions, therefore actual user #s may be lower than subscriber #s.
Copyright 2011. All rights reserved.

Note: Created for discussion purposes and a bit of humor. Not intended to discredit Maslow's hierarchy, which we believe to be accurate. Originally presented in Morgan Stanley’s “The Age of Engagement” presentation, dated April 2005
Copyright 2011. All rights reserved.

What Has One Insanely Great Designer / Entertainer / Leader / Businessman Wrought?

Before Steve Jobs… computers were utilitarian tools for computation. After Steve… computers became beautiful objects we could use in thousands of ways to aim to make life better. Steve’s design aesthetic was second to none.
Copyright 2011. All rights reserved.

Found it online for a better price Found it at another store for a better price Saw a negative review about the item I bought a similar item instead It was not available in-store No longer needed the item None of the above

52% 51% 34% 21% 17% 7% 1%
% of Respondents

Source: comScore US smartphone user survey, 7/11. Note: the same survey also indicated that 50% of USA smartphone users have used their smartphones to find a nearby store. So while mobile Internet is helping drive foot traffic to local stores, it is also helping make pricing info more transparent for the consumers.
Copyright 2011. All rights reserved.

• With undifferentiated products, price is competed down to marginal cost. And the marginal cost for digital content is $0. • How does one create differentiated content in an economically viable manner, when few want to pay for it? – For insights, check out Joanne Bradford’s Web 2.0 presentation.

In 140-character bites, the story unfolded: the shock and terror; the sense of human frailty mixed with lifesaving information; the messages of those seeking comfort and those seeing some kind of divine retribution, all mixing at hyper-speed. – LATimes, 3/11/11
Note: Yellow lines indicate tweets coming out of Japan; Pink lines indicate tweets coming into Japan. Source: Twitter.
Copyright 2011. All rights reserved.

Authentic Identity – The Good / Bad / Ugly. But Mostly Good?
With 800MM global active Facebook users…50% that log on in any given day…with an average of 130 friends…and an average of 80 community pages / groups / events…and more than 250MM photos uploaded per day and 350MM active mobile users…* And 835MM smartphone users (likely ramping to 1.4B within two years)… It’s hard to hide. The ‘truth’ is often just a photo/click–send away. ‘Clean, well-lighted place to do business?’ ‘People are basically good?’ In a world with tremendous uncertainty – owing to the rapid ramp in always-on, connected citizens of the world, perhaps, the world is on the cusp of being safer than ever? There are lots of sacrifices. This is new terrain. Only time will tell how all this plays out…
Source: Facebook, 10/11.
Copyright 2011. All rights reserved.

Note: Ranking excludes countries with gross government debt less than $10B in 2010. Gross government debt includes intragovernment obligations (such as Treasuries held by the Social Security Trust Fund in US’ case). Source: The International Monetary Fund (IMF).
Copyright 2011. All rights reserved.

62

USA Inc. @ kpcb.com / youtube.com / amazon.com

90K+ Total Views 14K+ YouTube Views 7K+ Facebook Likes 2K+ Retweets

Copyright 2011. All rights reserved.

63

CLOSING THOUGHTS

Copyright 2011. All rights reserved.

Economy – Often darkest before dawn. At least we know what the problems are. Now we need the resolve to fix them. Across-the-board sacrifice needed. Tech Industry – Wow! Unprecedented times! If you can keep your head when all about you are losing theirs…*
*Rudyard Kipling - ‘If’

Copyright 2011. All rights reserved.

65

Disclosure

The information offered in this presentation speaks to industry trends in general, and should not be construed as providing any particular recommendations or analysis for any specific company that is mentioned in this presentation. KPCB is a venture capital firm that owns significant equity positions in certain of the companies referenced in this presentation.